Linking indivisible projects enables compensation that separate bargaining forbids

Evidence

If there are two projects, each with a cost of three, and each with a value of two to A and a value of four to B, and each is inherently a “one-man” project in its execution, and if compensation is institutionally impossible, B will be forced to pay the entire cost of each as long as the two projects are kept separate. He cannot usefully threaten nonperformance, since A has no incentive to carry out either project by himself. But if B can link the projects together, offering to carry out one while A carries out the other, and can effectively threaten to abandon both unless A carries out one of them, A is left an option with a gain of four and a cost of three, which he takes, and B cuts his cost in half. — Thomas C. Schelling, The Strategy of Conflict, 88

Categorization

• XREF: This is the exact mechanism by which the Godfather bundles favours across clients: each act is indivisible and compensation is institutionally impossible in an honor economy, so linking separate obligations is the only way to transact — the Corleone network is a portfolio of linked one-man projects. — connects to: Complementary agreements are self-enforcing through interdependence and focal points — Thomas C. Schelling, The Strategy of Conflict, 312
• ADDENDUM: Supports the ‘Godfather-bonds’ argument: reciprocity across separate obligations is the compensation mechanism that formal markets and courts cannot provide.

Broader Connections

• Complementary agreements are self-enforcing through interdependence and focal points #corroborates (0.75) — Thomas C. Schelling, The Strategy of Conflict, 312